Monsanto and others facing ESG resolutions at annual meetings this month

Early stages of US proxy season

Agricultural chemicals giant Monsanto is set to be among the first major US companies to face an investor proposal on environmental, social and governance issues as the 2013 proxy voting season enters its early stages.

Other big names in the firing line on ESG in January include engineering group Jacobs Engineering and industrial conglomerate Johnson Controls.

Monsanto, which holds its AGM in Missouri on January 31, is facing a proposal from SRI fund firm Harrington Investments on genetically modified organisms (link to proxy). The company says the motion is not in the best interests of itself or its shareholders and is advising a vote against it. A similar resolution was defeated by 20.7m votes in favour vs. 340.6m against at the 2012 AGM.

Monsanto is currently under engagement from investors such as the £11.2bn (€13.9bn) Strathclyde Pension Fund.

Meanwhile, Johnson, the New York-listed group involved in energy efficiency and car batteries, holds its AGM in Milwaukee on January 23. An unnamed shareholder intends to submit a proposal calling for the separation of the chairman and chief executive.

Johnson’s board wants investors to vote against the motion, saying it already has strong corporate governance measures in place and that it would “unduly restrain the Board’s ability to govern”.Pasadena-based Jacobs, excluded by investors such as Norway’s KLP and the Netherlands’ PGGM over its involvement in nuclear weapons, holds its AGM on the 24th of this month. The Massachusetts Pension Reserves Investment and Management Board (MassPRIM) intends to present a proposal to repeal the company’s classified board at the meeting. The motion calls for all directors elected from the 2014 meeting onwards to be elected on an annual basis.

MassPRIM was advised by the Harvard Shareholder Rights Project of Lucien Bebchuk in putting the proposal together.

The company is advising its shareholders to vote against the proposal, saying it is “not in the best interests of the Company and its shareholders”.

In other news, the $150bn New York State Common Retirement Fund has sued IT firm Qualcomm to get it to reveal its political spending. The suit, filed this week in Delaware Court of Chancery, comes after Qualcomm refused the request by the fund, which has 6.1m shares in the company worth around $396m, to inspect records on the use of corporate resources for political activities.
“Without disclosure, there is no way to know whether corporate funds are being used in ways that go against shareholder interests,” said New York State Comptroller Thomas DiNapoli.
New York Common has been trying since August last year to get the information from Qualcomm without success, according to the suit.